Art. 448. The owner of the land on which anything
5581 which is the
has been built, sown or planted in good faith, shall
have the right to appropriate as his own the works,
sowing or plainting, after payment of the indemnity
provided for in articles 546 and 548, or to oblige the
owner who built or planted to pay the price of the
land, and the one who sowed, the proper rent.
However, the builder or planter cannot be obliged to
buy the land if its value is considerably more than
that of the building or trees. In such case, he shall
pay reasonable rent, if the owner of the land does
not choose to appropriate the building or trees after
proper indemnity. The parties shall agree upon the
terms of the lease and in case of disagreement, the
court shall fix the terms thereof.1âw phi 1.nêt
28
Art. 546. Necessary expenses shall be refunded to
every possessor; but only the possessor in good
faith may retain the thing until he has been
reimbursed therefor.
Useful expenses shall be refunded only to the
possessor in good faith with the same right of
retention, the person who has defeated him in the
possession having the option of refunding the
amount of the expenses or of paying the increase in
value which the thing may have acquired by reason
thereof.
G.R. No. 134329 January 19, 2000
VERONA PADA-KILARIO and RICARDO KILARIO,
vs.
COURT OF APPEALS and SILVERIO PADA
FACTS:
 One Jacinto Pada had six (6) children, namely,
Marciano, Ananias, Amador, Higino, Valentina
and Ruperta.
 He died intestate.
 His estate included a parcel of land of
residential and coconut land located at
Poblacion, Matalom, Leyte, denominated as
Cadastral Lot No. 5581 with an area of
1,301.92 square meters. It is the northern
portion of Cadastral Lot No.
subject of the instant controversy.
During the lifetime of Jacinto Pada, his half-brother,
Feliciano Pada, obtained permission from him to
build a house on the northern portion of Cadastral
Lot No. 5581.
When Feliciano died, his son, Pastor, continued living
in the house together with his eight children.
Petitioner Verona Pada-Kilario, one of Pastor's
children, has been living in that house since 1960.
Sometime in May, 1951, the heirs of Jacinto Pada
entered into an extra-judicial partition of his estate.
For this purpose, they executed a private document
which they, however, never registered in the Office
of the Registrar of Deeds of Leyte.
At the execution of the extra-judicial partition,
Ananias was himself present while his other brothers
were represented by their children.
Their sisters, Valentina and Ruperta, both died
without any issue.
Marciano was represented by his daughter, Maria;
Amador was represented by his daughter, Concordia;
and Higina was represented by his son, Silverio who is
the private respondent in this case. It was to both
Ananias and Marciano, represented by his daughter,
Maria, that Cadastral Lot No. 5581 was allocated
during the said partition. When Ananias died, his
daughter, Juanita, succeeded to his right as co-owner
of said property.
On June 14, 1978, Juanita Pada sold to Engr. Ernesto
Paderes, the right of his father, Ananias, as co-owner
of Cadastral Lot No. 5881.
On November 17, 1993, it was the turn of Maria Pada
to sell the co-ownership right of his father, Marciano
to his first cousin silverio the son of Higino.
Thereafter, SILVERIOS demanded that the PADA –
KILARIO spouses vacate the northern portion of
Cadastral Lot No. 5581 so his family can utilize the said
area. They went through a series of meetings with the
barangay officials concerned for the purpose of
amicable settlement, but all earnest efforts toward
that end, failed.
On June 26, 1995, SILVERIO filed in the Municipal
Circuit Trial Court of Matalom, Leyte, a complaint for
ejectment with prayer for damages against petitioner
spouses.
On July 24, 1995, the heirs of Amador Pada, namely,
Esperanza Pada-Pavo, Concordia Pada-Bartolome,
and Angelito Pada, executed a Deed of
Donation9 transferring to petitioner Verona Pada-
Kilario, their respective shares as co-owners of
Cadastral Lot No. 5581.
On February 12, 1996, spouses PADA- KILARIO filed
their Answer averring that the northern portion of
Cadastral Lot No. 5581 had already been donated to
them by the heirs of Amador Pada.
They contended that the extra-judicial partition of the
estate of Jacinto Pada executed in 1951 was invalid
and ineffectual since no special power of attorney
was executed by either Marciano, Amador or Higino
in favor of their respective children who represented
them in the extra-judicial partition. Moreover, it was
effectuated only through a private document that was
never registered in the office of the Registrar of Deeds
of Leyte.
The Municipal Circuit Trial Court rendered judgment in
favor of petitioner spouses. It made the following
findings:
After a careful study of the evidence submitted by
both parties, the court finds that the evidence
adduced by plaintiff failed to establish his ownership
over . . . Cadastral Lot No. 5581 . . . while defendants
has [sic] successfully proved by preponderance of
evidence that said property is still under a community
of ownership among the heirs of the late Jacinto Pada
who died intestate. If there was some truth that
Marciano Pada and Ananias Pada has [sic] been
adjudicated jointly of [sic] the above-described
residential property . . . as their share of the
inheritance on the basis of the alleged extra judicial
settlement, how come that since 1951, the date of
partition, the share of the late Marciano Pada was not
transferred in the name of his heirs, one of them Maria
Pada-Pavo and still remain [sic] in the name of Jacinto
Pada up to the present while the part pertaining to the
share of Ananias Pada was easily transferred in the
name of his heirs . . ..
The alleged extra judicial settlement was made in
private writing and the genuineness and due
execution of said document was assailed as doubtful
and it appears that most of the heirs were not
participants and signatories of said settlement, and
there was lack of special power of attorney to [sic]
those who claimed to have represented their co-heirs
in the participation [sic] and signing of the said extra
judicial statement.
Defendants were already occupying the northern
portion of the above-described property long before
the sale of said property on November 17, 1993 was
executed between Maria Pada-Pavo, as vendor and
the plaintiff, as vendee. They are in possession of said
portion of the above-described property since the
year 1960 with the consent of some of the heirs of
Jacinto Pada and up to the [sic] present some of the
heirs of Jacinto Pada has [sic] donated . . . their share
of [sic] the above-described property to them, virtually
converting defendants' standing as co-owners of the
land under controversy. Thus, defendants as co-
owners became the undivided owners of the whole
estate . . . . As co-owners of . . . Cadastral Lot No. 5581
. . . their possession in the northern portion is being
[sic] lawful.10
From the foregoing decision, private respondent
appealed to the Regional Trial Court. On November 6,
1997, it rendered a judgment of reversal. It held:
. . . [T]he said conveyances executed by Juanita Pada
and Maria Pada Pavo were never questioned or
assailed by their co-heirs for more than 40 years,
thereby lending credence on [sic] the fact that the two
vendors were indeed legal and lawful owners of
properties ceded or sold. . . . At any rate, granting that
the co-heirs of Juanita Pada and Maria Pada Pavo have
some interests on the very lot assigned to Marciano
and Ananias, nevertheless, said interests had long
been sadly lost by prescription, if not laches or
estoppel.
It is true that an action for partition does not
prescribe, as a general rule, but this doctrine of
imprescriptibility cannot be invoked when one of the
heirs possessed the property as an owner and for a
period sufficient to acquire it by prescription because
from the moment one of the co-heirs claim [sic] that
he is the absolute owner and denies the rest their
share of the community property, the question then
involved is no longer one for partition but of
ownership. . . . Since [sic] 1951 up to 1993 covers a
period of 42 long years. Clearly, whatever right some
of the co-heirs may have, was long extinguished by
laches, estoppel or prescription.
xxx xxx xxx
. . . [T]he deed of donation executed by the Heirs of
Amador Pada, a brother of Marciano Pada, took place
only during the inception of the case or after the lapse
of more than 40 years reckoned from the time the
extrajudicial partition was made in 1951. Therefore,
said donation is illegal and invalid [sic] the donors,
among others, were absolutely bereft of any right in
donating the very property in question.11
The dispositive portion of the decision of the Regional
Trial Court reads as follows:
WHEREFORE, a judgment is hereby rendered,
reversing the judgment earlier promulgated by the
Municipal Circuit Trial Court of Matalom, Leyte, [sic]
consequently, defendants-appellees are hereby
ordered:
1. To vacate the premises in issue and return peaceful
possession to the appellant, being the lawful
possessor in concept of owner;
2. To remove their house at their expense unless
appellant exercises the option of acquiring the same,
in which case the pertinent provisions of the New Civil
Code has to be applied;
3. Ordering the defendants-appellees to pay monthly
rental for their occupancy and use of the portion of the
land in question in the sum of P100.00 commencing on
June 26, 1995 when the case was filed and until the
termination of the present case;
4. Ordering the defendants to pay to the appellant the
sum of P5,000.00 as moral damages and the further
sum of P5,000.00 as attorney's fees;
5. Taxing defendants to pay the costs of suit.12
Petitioners filed in the Court of Appeals a petition for
review of the foregoing decision of the Regional Trial
Court.
On May 20, 1998, respondent Court of Appeals
rendered judgment dismissing said petition. It
explained:
Well-settled is the rule that in an ejectment suit, the
only issue is possession de facto or physical or
material possession and not de jure. Hence, even if the
question of ownership is raised in the pleadings, the
court may pass upon such issue but only to determine
the question of possession, specially if the former is
inseparably linked with the latter. It cannot dispose
with finality the issue of ownership, such issue being
inutile in an ejectment suit except to throw light on the
question of possession . . . .
Private respondent Silverio Pada anchors his claim to
the portion of the land possessed by petitioners on the
Deed of Sale executed in his favor by vendor Maria
Pada-Pavo, a daughter of Marciano, son of Jacinto
Pada who was the registered owner of the subject lot.
The right of vendee Maria Pada to sell the property
was derived from the extra-judicial partition executed
in May 1951 among the heirs of Jacinto Pada, which
was written in a Bisayan dialect signed by the heirs,
wherein the subject land was adjudicated to
Marciano, Maria Pavo's father, and Ananias Pada.
Although the authenticity and genuineness of the
extra-judicial partition is now being questioned by the
heirs of Amador Pada, no action was ever previously
filed in court to question the validity of such partition.
Notably, petitioners in their petition admitted among
the antecedent facts that Maria Pavo is one of the co-
owners of the property originally owned by Jacinto
Pada . . . and that the disputed lot was adjudicated to
Marciano (father of Maria Pavo) and Ananias, and
upon the death of Marciano and Ananias, their heirs
took possession of said lot, i.e. Maria Pavo the vendor
for Marciano's share and Juanita for Ananias' share . .
. . Moreover, petitioners do not dispute the findings of
the respondent court that during the cadastral survey
of Matalom, Leyte, the share of Maria Pada Pavo was
denominated as Lot No. 5581, while the share of
Juanita Pada was denominated as Lot No. 6047, and
that both Maria Pada Pavo and Juanita were in
possession of their respective hereditary shares.
Further, petitioners in their Answer admitted that they
have been occupying a portion of Lot No. 5581, now in
dispute without paying any rental owing to the
liberality of the plaintiff . . . . Petitioners cannot now
impugn the aforestated extrajudicial partition
executed by the heirs in 1951. As owner and possessor
of the disputed property, Maria Pada, and her vendee,
private respondent, is entitled to possession. A
voluntary division of the estate of the deceased by the
heirs among themselves is conclusive and confers
upon said heirs exclusive ownership of the respective
portions assigned to them . . ..
The equally belated donation of a portion of the
property in dispute made by the heirs of Amador Pada,
namely, Concordia, Esperanza and Angelito, in favor of
petitioner Verona Pada is a futile attempt to confer
upon the latter the status of co-owner, since the
donors had no interest nor right to transfer. . . . This
gesture appears to be a mere afterthought to help
petitioners to prolong their stay in the premises.
Furthermore, the respondent court correctly pointed
out that the equitable principle of laches and estoppel
come into play due to the donors' failure to assert
their claims and alleged ownership for more than forty
(40) years . . . . Accordingly, private respondent was
subrogated to the rights of the vendor over Lot No.
5581 which include [sic] the portion occupied by
petitioners.13
Petitioner spouses filed a Motion for Reconsideration
of the foregoing decision.
On June 16, 1998, respondent Court of Appeals issued
a Resolution denying said motion.
Hence this petition raising the following issues:
I. WHETHER THE COURT OF APPEALS ERRED
IN NOT RULING THAT PETITIONERS, AS
CO-OWNERS, CANNOT BE EJECTED FROM
THE PREMISES CONSIDERING THAT THE
HEIRS OF JACINTO PADA DONATED TO
THEM THEIR UNDIVIDED INTEREST IN THE
PROPERTY IN DISPUTE.
II. WHETHER THE COURT OF APPEALS ERRED
IN NOT RULING THAT WHAT MARIA PADA
SOLD WAS HER UNDIVIDED SHARE IN THE
PROPERTY IN DISPUTE.
III. WHETHER OR NOT THE PETITIONERS ARE
BUILDERS IN GOOD FAITH.14
There is no merit to the instant petition.
First.
We hold that the extrajudicial partition of the estate
of Jacinto Pada among his heirs made in 1951 is valid,
albeit executed in an unregistered private document.
No law requires partition among heirs to be in writing
and be registered in order to be valid.15 The
requirement in Sec. 1, Rule 74 of the Revised Rules of
Court that a partition be put in a public document and
registered, has for its purpose the protection of
creditors and the heirs themselves against tardy
claims.16 The object of registration is to serve as
constructive notice to others. It follows then that the
intrinsic validity of partition not executed with the
prescribed formalities is not undermined when no
creditors are involved.17 Without creditors to take into
consideration, it is competent for the heirs of an
estate to enter into an agreement for distribution
thereof in a manner and upon a plan different from
those provided by the rules from which, in the first
place, nothing can be inferred that a writing or other
formality is essential for the partition to be valid.18 The
partition of inherited property need not be embodied
in a public document so as to be effective as regards
the heirs that participated therein.19 The requirement
of Article 1358 of the Civil Code that acts which have
for their object the creation, transmission,
modification or extinguishment of real rights over
immovable property, must appear in a public
instrument, is only for convenience, non-compliance
with which does not affect the validity or
enforceability of the acts of the parties as among
themselves.20 And neither does the Statute of Frauds
under Article 1403 of the New Civil Code apply
because partition among heirs is not legally deemed a
conveyance of real property, considering that it
involves not a transfer of property from one to the
other but rather, a confirmation or ratification of title
or right of property that an heir is renouncing in favor
of another heir who accepts and receives the
inheritance.21 The 1951 extrajudicial partition of
Jacinto Pada's estate being legal and effective as
among his heirs, Juanita and Maria Pada validly
transferred their ownership rights over Cadastral Lot
No. 5581 to Engr. Paderes and private respondent,
respectively.
Second.
The extrajudicial partition which the heirs of Jacinto
Pada executed voluntarily and spontaneously in 1951
has produced a legal status.23 When they discussed
and agreed on the division of the estate Jacinto Pada,
it is presumed that they did so in furtherance of their
mutual interests. As such, their division is conclusive,
unless and until it is shown that there were debts
existing against the estate which had not been
paid.24 No showing, however, has been made of any
unpaid charges against the estate of Jacinto Pada.
Thus, there is no reason why the heirs should not be
bound by their voluntary acts.
The belated act of Concordia, Esperanza and Angelito,
who are the heirs of Amador Pada, of donating the
subject property to petitioners after forty four (44)
years of never having disputed the validity of the 1951
extrajudicial partition that allocated the subject
property to Marciano and Ananias, produced no legal
effect. In the said partition, what was allocated to
Amador Pada was not the subject property which was
a parcel of residential land in Sto. Nino, Matalom,
Leyte, but rather, one-half of a parcel of coconut land
in the interior of Sto. Nino St., Sabang, Matalom, Leyte
and one-half of a parcel of rice land in Itum, Sta. Fe,
Matalom, Leyte. The donation made by his heirs to
petitioners of the subject property, thus, is void for
they were not the owners thereof. At any rate it is too
late in the day for the heirs of Amador Pada to
repudiate the legal effects of the 1951 extrajudicial
partition as prescription and laches have equally set in.
Third.
Petitioners are estopped from impugning the
extrajudicial partition executed by the heirs of Jacinto
Pada after explicitly admitting in their Answer that
they had been occupying the subject property since
1960 without ever paying any rental as they only relied
on the liberality and tolerance of the Pada
family.25 Their admissions are evidence of a high order
and bind them insofar as the character of their
possession of the subject property is concerned.
Considering that petitioners were in possession of the
subject property by sheer tolerance of its owners, they
knew that their occupation of the premises may be
terminated any time. Persons who occupy the land of
another at the latter's tolerance or permission,
without any contract between them, is necessarily
bound by an implied promise that they will vacate the
same upon demand, failing in which a summary action
for ejectment is the proper remedy against
them.26 Thus, they cannot be considered possessors
nor builders in good faith. It is well-settled that both
Article 44827 and Article 54628 of the New Civil Code
which allow full reimbursement of useful
improvements and retention of the premises until
reimbursement is made, apply only to a possessor in
good faith, i.e., one who builds on land with the belief
that he is the owner thereof.29 Verily, persons whose
occupation of a realty is by sheer tolerance of its
owners are not possessors in good faith. Neither did
the promise of Concordia, Esperanza and Angelito
Pada that they were going to donate the premises to
petitioners convert them into builders in good faith for
at the time the improvements were built on the
premises, such promise was not yet fulfilled, i.e., it
was a mere expectancy of ownership that may or may
not be realized.30 More importantly, even as that
promise was fulfilled, the donation is void for
Concordia, Esperanza and Angelito Pada were not the
owners of Cadastral Lot No. 5581. As such, petitioners
cannot be said to be entitled to the value of the
improvements that they built on the said lot.

WHEREFORE, the petition for review is HEREBY

DENIED.